2012 (11) TMI 991 - AT - Central Excise

Whether the duty paid by the job worker on goods, received back by the appellant can be availed as Cenvat credit by the appellant Held that - Once the duty has been paid by job worker on goods sent back to appellant, there is no reason to deny benefit of Cenvat credit to the appellant In favor of assessee

Summary

Issues:
- Appeal against denial of Cenvat credit on duty paid by job worker on inputs returned to the appellant.

Analysis:
The case involved an appeal by Filtrum Tools & Components Pvt. Ltd. against the denial of Cenvat credit on duty paid by a job worker on inputs returned to the appellant. The Department had not allowed the Cenvat credit, leading to a show-cause notice and subsequent adjudication confirming duty, interest, and penalty. The appellant challenged the Order-in-Original before the Commissioner (Appeals), who rejected the appeal, prompting the appeal before the Tribunal.

The appellant argued that since the duty had been paid by the job worker and the inputs were returned, there was no justification for denying the Cenvat credit. The appellant relied on a decision of the Hon'ble Bombay High Court in the case of CCE v. Nestle India Ltd. to support their contention. On the other hand, the Authorized Representative for the revenue supported the lower authorities' findings and the rejection of the appeal by the Commissioner (Appeals).

Upon consideration, the Tribunal found that the key issue in the appeal was whether the duty paid by the job worker on the goods, subsequently received back by the appellant, could be availed as Cenvat credit. The Tribunal noted that the matter was squarely covered by the decision of the Hon'ble Bombay High Court in the case of Nestle India Ltd. The Tribunal concluded that once the duty had been paid by the job worker on the goods returned to the appellant, there was no valid reason to deny the appellant the benefit of Cenvat credit.

Consequently, the Tribunal set aside the impugned order and allowed the appeal filed by the appellant, thereby ruling in favor of Filtrum Tools & Components Pvt. Ltd.